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How to Invest in Palladium

26 April 2022

Global mine production of palladium 2010 – 2020
  • Palladium spot price v. Gold spot price
  • How to invest in palladium
  • A rare precious metal that’s worth looking into 
​​​​​​​Dear Investor,

Most people know that gold and silver are precious metals, but did you know there are five in total? They are gold, silver, platinum, palladium, and rhodium. 

All five are scarce, durable, and useful. Now platinum and palladium are part of what’s called platinum group metals (PGMs)…which are actually comprised of six metals: platinum (Pt), palladium (Pd), iridium (Ir), Osmium (Os) rhodium (Rh) and ruthenium (Ru). 

PGMs are among the rarest metals on Earth. Platinum, palladium, and rhodium are rarer than gold. Iridium, osmium, and ruthenium are even rarer than the other three. While a chemist would consider all PGMs ‘precious metals’— because PGMs exhibit similar chemical traits — an investor wouldn’t. 

The reason? Iridium, osmium, rhodium, and ruthenium are extremely scarce. Their uses are solely industrial and their markets are too small to have any sustainable value for investment purposes. 

Even among precious metal investors, palladium isn’t well known. It’s extremely rare, and supply is constrained. Russia is the largest producer, with South Africa close behind. Canada and the United States are a distant third and fourth respectively. 

Global mine production of palladium 2010 – 2020 

Source: Statista 

Palladium has significantly outperformed gold in the past three years. Palladium is a critical metal in catalytic converters (used to reduce exhaust emissions in vehicles) and in the past Pd’s performance has been tightly linked to the production of vehicles.  

However, the ongoing dispute in Ukraine is causing concern over the future supply of palladium for the market. As a result, Pd recently touched an all-time higher of US$3,400. Despite Pd prices pulling back, palladium has significantly outperformed gold in the past five years. 

Palladium spot price v. Gold spot price 

Source: Trading View 

The fortunes of palladium are tied to car manufacturers and Russian conflict at present. The question is, will you be prepared? 

How to invest in palladium 

When you are ready to invest in palladium, there are several options you can explore, these include -

Physical Palladium

You can invest in palladium in the form of jewellery, coins, and bars, such as 10-ounce bars that are as attractive as they are valuable.

Our most popular is the Valcambi 1oz palladium bar. Our clients often buy palladium in conjunction with holdings in gold, silver and platinum.
Pool Allocated Palladium

Another way to invest in palladium is by letting a brand like ABC Bullion hold your physical metal on your behalf. This is referred to as pool allocated palladium. Your holdings will be backed by the physical metal, but the palladium will be kept in custodial storage, with insurance, at no cost to you. For these reasons, this investment option is affordable and convenient.
Palladium ETFs (Exchange Traded Funds)

You can invest in palladium via ETFs however be sure to check the investment structure of the fund to ensure that it is suitably backed by physical palladium. Bear in mind that investors in ETFs have no direct claim on the underlying investments or assets, and the entire fund may be traded or liquidated at any time.

Palladium: a rare precious metal that is worth exploring

Rarer than gold and platinum, palladium is a versatile, durable, and attractive metal that is gaining more and more popularity. If you are interested in purchasing fine jewellery or investing in precious metals, consider buying palladium and adding it to your investment portfolio. And if you already have a portfolio of precious metals like gold and silver, palladium could help diversify your portfolio further.

The price may fluctuate, but if the supply remains low and demand stays high, you could get a great return on your investment when you are ready to cash out.

Warm regards,
The ABC Bullion Team